Institute for Economic and Social Research – Faculty of Economics and Business – Universitas Indonesia

Economic Analysis Series: TRADE AND INDUSTRY BRIEF, September 2022

Monday September 26th, 2022

The government’s policy of diverting part of the fuel subsidy to a program to strengthen social protection as of 3 September has drawn various responses from the public. On the one hand, the government explains that the fuel subsidy has been misdirected, shackles the state budget, and is prone to swelling if world oil prices fluctuate again. On the other hand, many critics have highlighted the potential impact in the form of a decrease in people’s purchasing power, an increase in the number of poor people, and the delay in economic recovery after the Covid-19 pandemic.

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